Financial results Year ended 30 June 2017 Nelson Point
Financial results Year ended 30 June 2017 Andrew Mackenzie Chief Executive Officer BMA
Key messages We are focused on cash flow, capital discipline and value Maximise cash flow Capital discipline Value and returns US12.6 billion 274% US16.3 billion 9.8 bn ROCE up to 10% (after tax) free cash flow net debt further…
FY17 scorecard Strong cash generation delivers debt reduction and shareholder returns Safety Tragically two of our colleagues died over the last 14 months TRIF of 4.21 Financial Attributable profit of US5.9 billion; Underlying…
Safety and sustainability We achieve nothing unless we achieve it safely Committed to social and environmental rehabilitation in Brazil Tragically, we had a fatality at Escondida (October 2016), and Progress on social and environmental…
Financial results Year ended 30 June 2017 Peter Beaven Chief Financial Officer Spence
Financial performance Productivity and simplified structure underpin margins Summary FY17 Income Statement Strong margins through the cycle (US billion) (Underlying EBITDA margin6, %) 60 Underlying EBITDA 20.3 64% EBITDA margin 55%…
Segment performance Balanced contribution across the portfolio Iron Ore Petroleum 44% of Group EBITDA11 20% of Group EBITDA11 High margins on record volumes Over 200% reserve replacement Cost12: US14.60/t 3% Conventional cost:…
Capital allocation Relentless focus on capital discipline, debt reduction and shareholder returns FY17 Operating Capital productivity productivity Net operating cash flow Less: dividends to US16.8 bn NCIs of US0.6 bn15…
Balance sheet Net debt US16.3 billion; gearing 20.6%; average debt maturity 9.1 years Net debt and gearing Movements in net debt (Net debt, US billion) (Gearing, %) (US billion) 30 40 30 26.1 Non-cash 0.6 2.9 0.5 17 16.3 15 25 15…
Investing for the future Expected average returns on FY18 development19 capex of over 20% Capital and exploration expenditure (cash basis) (US billion) 20 Exploration 10 Major projects 6.9 bn Onshore US 5.2 bn Latent…
Jansen Jansen will proceed only if it passes strict capital allocation framework tests Market 2-3% expected annual potash demand growth with demand to outstrip supply in mid 2020s fundamentals While long-term fundamentals remain…
Return on Capital Employed FY17 ROCE improves to 10% (after tax) ROCE by asset (%) Productivity and technology to further improve performance Antamina20 25 NSWEC Cerrejn20 15 Pampa Norte WAIO QCoal No strike and ramp-up of LCE,…
Financial results Year ended 30 June 2017 Andrew Mackenzie Chief Executive Officer Neptune
Market outlook Near-term uncertainty, attractive long-term fundamentals Short term Medium term Long term Growth in Uncertainty Modest Steeper New demand New supply population, high growth cost curves centres wealth…
Our strategy Value and returns are at the centre of everything we do Simple portfolio Distinctive enablers Shareholder Diversified exposure to preferred value and Charter Values and commodities returns culture of connectivity…
Strategy execution We continued to make strong progress on our plans in FY17 Productivity Additional productivity gains of US1.3 billion 4% reduction in unit costs2 Latent Spence Recovery Optimisation and Jimblebar crusher…
Onshore US Onshore US assets are non-core and we are actively looking to exit for value Alternatives Considerations Trade sale Valuation and marketability Asset swap22 Impact on shareholders Demerger Clean exit IPO Funding…
We delivered against our plans in FY17 ROCE (%) Maximise Free cash flow of US12.6 billion 20 cash flow All operating assets free cash flow positive Capital US9.8 billion reduction in net debt 10 discipline Capital productivity…
and will further deliver in FY18 ROCE (%) Maximise 7% copper equivalent volume growth 20 cash flow Free cash flow of US10 billion at spot prices24 Capital Average returns of over 20% on FY18 development capex19 10 discipline…
and will continue to deliver over the medium term ROCE (%) Maximise Productivity gains of US2 billion by end-FY19 20 cash flow Focused on unit cost reductions…
Appendix
Samarco and Renova Foundation Committed to social and environmental rehabilitation Rio Gualaxo do Norte October 2016 December 2016 January 2017 February 2017 Rehabilitation (Renova Foundation) Legal developments Samarco mine…
BHP guidance Group FY18e Capital and exploration expenditure (USbn) 6.9 Cash basis. Including: Maintenance 2.0 Includes non-discretionary capital expenditure to maintain asset integrity, reduce risks, and meet compliance requirements.…
BHP guidance (continued) Copper FY18e Total copper production (Mt) 1.66 1.79 Escondida at 1.130 - 1.230 Mt, Pampa Norte production is expected to increase, Olympic Dam at 150 kt and Antamina production at 125 kt and zinc at 100 kt.…
Key Underlying EBITDA sensitivities Approximate impact25 on FY18 Underlying EBITDA of changes of: US million US1/t on iron ore price26 241 US1/bbl on oil price27 64 US10/MMbtu on US gas price 23 US1/t on metallurgical coal price…
Debt maturity profile Debt balances29, 30 (US billion) 8 6 4 2 0 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 Post FY28 US Euro Sterling A C Bonds31 Bonds31 Bonds 31 Bonds Bonds Subsidiaries % of portfolio 36%…
Footnotes 1. BHP operated assets. 2. Operating cost per copper equivalent tonne presented on a continuing operations basis excluding royalties and BHP's share of volumes from equity accounted investments; copper equivalent production…
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